July 25, 2017

All The Symptoms Were There

A report from City AM on the UK. “Analysis of homes listed on Zoopla has found 35.3 per cent of all homes listed for sale in the capital have had their prices cut since they were first listed, up from 29.7 per cent in February. The study, by online estate agent HouseSimple.com, found Richmond is the borough with the highest percentage of price cuts: almost 46 per cent of homes on sale in the borough have been reduced in price. That’s followed by Kingston Upon Thames, where just over 45 per cent of homes have had their prices cut. The news came a day after analysis by Savills showed the number of people leaving the capital has shot up by 80 per cent in the past five years, as high house prices drive buyers further afield.”

“‘What’s unusual about the level of discounted properties is that it would suggest there are too many sellers and not enough buyers,’ pointed out Alex Gosling, chief executive of HouseSimple. ‘But strangely this market is still suffering from a lack of new supply. There are actually plenty of buyers looking, but they’re a different buyer from 12 months ago. They are more cautious and viewing multiple properties before making a decision. Long gone are the days when buyers were diving in to avoid missing out as the market accelerated away from them.’”

The Daily Trust on Nigeria. “Presently there is low demand for real estate in major cities like Lagos, Abuja and Port Harcourt, due to the harsh economic situation of the country. Daily Trust investigations showed that real estate developers find it difficult to sell their houses and as a result could not embark on new ones. Also, many tenants are unable to meet up with their rent payments, leading to vacant residential properties especially in some highbrow locations in Abuja and Lagos.”

“On the suggestion that the current crack down on corrupt Nigerians by the EFCC compounded the lull in property business, as looted money were hurriedly injected into the market in the past to keep their ill-gotten wealth, President of Real Estate Developers Association of Nigeria Mr Chime Ugochuwu affirmed this, but said it will only affect the high end properties.”

“‘That is true but corruption is not sustainable to national development of any nation and therefore you cannot develop your nation based on corrupt funding - those are illicit funds. It is going to affect high-end houses which people cannot afford. Now, we need to be reasonable. Some of the property that we have in highbrow areas like Maitama are not okay. One man cannot have a house of 12 rooms because he cannot have people occupying it with a family of four. It tells us to now invest money in affordable houses where the masses are.’”

The Sun Daily Malaysia. “The government may look into having a single authority to oversee the property market in the near future, said Second Finance Minister Datuk Seri Johari Abdul Ghani. ‘You talk to the the private sector, the affordable house is RM500,000 and you have an issue of oversupply of property. Today, if you look at all the high-end properties in Kuala Lumpur at night, only 10% of the total units is lighted (occupied). The rest in non-productive. You can’t even get tenants. This is unproductive investments of our money in our economy. It’s something that we need to address,’ stressed Johari.”

The Otago Daily Times on New Zealand. “Median house prices across Otago continue to show annual gains, but cracks are appearing in the previously buoyant Queenstown Lakes district where both volumes and prices are down. The number of houses throughout the country that sold for more than $1 million plunged almost 30% from 1099 in June last year to 799 last month. Against last year, sales volumes across the country continued to decline; nationally down 24.7%, Auckland down 33.2%, Otago down 17.8% and Queenstown Lakes down 34%.”

“Westpac acting chief economist Michael Gordon said the REINZ data pointed to a ’substantially softer’ housing market in June. ‘While the slowdown was originally concentrated in Auckland, it’s now spreading to a greater number of regions,’ he said.”

From Domain News on Australia. “A high concentration of inner-city apartments has caused a chain reaction in the Brisbane rental market, leading to rental yields for detached houses falling more than seven per cent in the past year. Stagnant rents and vacancy rates for the Greater Brisbane region hide a more serious problem — investors are now making less returns.”

“Haesley Cush, of Living Here and Ray White, said competition between landlords to set out flashy and new apartments from each other drove down prices of the new builds. ‘If you release 200 units at the same time with very little difference between them, the first one that’s going to rent will be the cheapest one.’”

“Buyer’s agent and property pundit Pete Wargent said the blame did not fall solely on the private or public sectors. ‘It was a confluence of factors; the city plan allowed a lot of new apartments to be built and for a certain amount of time the city council was happier to approve borderline cases but I know now it’s harder for them to get approved,’ Mr Wargent said. ‘The other thing was Chinese buyers, which was a trend that came out of nowhere. I think developers became more confident they could sell apartments to anyone.’”

“Mr Wargent said he was surprised by the lengths property managers and landlords would go to secure a lease. ‘A lot of new dwellings are offering free rent and even $1000 cash back which is extremely unusual.’”

The Globe and Mail on Canada . “House prices have been falling in Toronto. Yes, falling. To many people, that comes as a rude shock. Prices rose for so long that it seemed as if it were the natural state of affairs. The idea took hold that Toronto was somehow unique, its housing market immune to the corrections and crashes that have afflicted just about every city (Toronto itself included) at one time or another.”

“Even now, real estate hucksters and sanguine economists say the current downturn is merely a pause in an unstoppable ascent. All the factors, they insist, point up, up, up. But similar things were being said about London or Orlando before the British and U.S. housing markets hit the skids a few years ago. No commodity keeps gaining value without interruption.”

“The fundamentals are only part of the picture. Psychology plays a part, too. People have a tendency to get carried away when things are going well and panic when they threaten to turn bad. To begin with, the fever has broken. The wild run-up in prices over the past year was a sort of sickness. Seized by the belief that prices could only climb further, buyers afraid of missing the boat were paying obscene amounts for little, rundown houses. Bully bids, bidding wars, inflated over-asking prices – all the symptoms were there.”

“That has changed over the past few weeks. Sales are off and prices are down from their stupid heights of this spring, although in the first half of June the cost of a house was still above where it was a year before. A degree of sanity has returned.”

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Comment by Ben Jones
2017-07-25 09:45:07

Also from the UK:

‘Interest-only mortgages are a ‘ticking time bomb’ for hundreds of thousands of families who have no idea how they will repay the money they owe, experts have warned. As many as 1.9million borrowers are paying off the interest on their home loans without making a dent in the capital, figures from the Council of Mortgage Lenders (CML) show.’

‘It is estimated that one in ten of these households have no plan in place to pay off the loan when their mortgage deal expires. And many who do have a plan may find they do not have enough money to repay the loan in full.’

‘Adrian Anderson, a mortgage broker with Anderson Harris, said: ‘We have definitely got an interest-only mortgage ticking time bomb scenario.’

‘The CML said there are 11,000 mortgage deals with two years or less left to run where the loans are worth over 75 per cent of the value of the home. Rising house prices ‘can do little to improve the equity position for these loans’, it added.’

Comment by Mr. Banker
2017-07-25 10:22:14

Interest-only mortgages.

One would think a product of this nature would be a tough sell, but it isn’t.

A bit amazing if you stop to think about it.

Comment by Carl Morris
2017-07-25 10:38:18

It makes perfect sense if housing always goes up.

Comment by scdave
2017-07-25 15:39:43

It makes perfect sense if housing always goes up ??

Not necessarily. A friend of mine with a home well north of 2-mil just got a interest only refi so he could by a vacation home all cash. He borrowed @ 2.875% fixed for 7 years. He pays about $2500. Per month. Between him and the wife that payment reflects a couple of days pay.

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Comment by Rental Watch
2017-07-25 17:04:14

I knew a gentleman who borrowed against a $9MM home that he had owned free and clear. He mainly borrowed because in his view, the money was effectively free–with tax deductible interest for the million he borrowed.

However, IIRC, he did so on a 30-year fixed basis, but it wouldn’t have surprised me if he borrowed interest only given the circumstances (borrowing simply to get some of that cheap debt).

Comment by scdave
2017-07-25 17:46:38

(borrowing simply to get some of that cheap debt) ??


Comment by Ol'Bubba
2017-07-25 16:10:39

To echo scdave’s point, an interest only mortgage could make a lot of sense if you have a low loan to value ratio and you plan on living in the property for an extended period of time.

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Comment by Can Bubble
2017-07-25 10:21:57

A few years ago Chinese soccer teams started attracting big-name Brazilian and international superstars by tripling their wages.

Now they can’t meet their payroll. The bubble is wide-spread:

“A WHOPPING 13 Chinese Super League sides are set to forfeit from participating next season due to unpaid payments to players.

Clubs have until August 15 to correctly pay their players’ wages, as well as sending proof to the Chinese Football Association, otherwise they will be axed from competing.”


Comment by 2banana
2017-07-25 10:54:50

Bubbles in soccer salaries…

There is almost nothing not in a bubble.

Besides worker’s wages.

The insanity of cheap and easy money and massive deficits

Comment by PitchforkPurveyor
2017-07-25 11:58:32

Notice how it ALWAYS goes to the top?

Comment by In Colorado
2017-07-26 09:30:32

In the US, the soccer league (MLS) has team salary caps. Few players in the MLS earn 7 figures. Many only earn 5 figures.

Comment by Taxpayers
2017-07-25 11:18:00

Malaysia,one gov re agency? We have more than ten
Chop heads
Very few for sale signs in Pacific heights

Comment by Stan
2017-07-25 11:34:35

Sorry for the long post, this is from Hughes Marino newsletter.

“By Jason Hughes

600 B Street

For those of you following the play-by-play musical chairs of high-rise Downtown office buildings, Lincoln Properties (seller) had it in escrow to Rockwood (buyer) – but they pulled out of escrow. The new buyer is: (drumroll please!) Lincoln Properties! Yes, that is correct. The buyer is the same as the seller – just with a new equity partner.

530 B Street

The ultimate musical chair. Union Bank sold to Kearny Real Estate. Kearny sold to Bosa. Bosa is now selling to Swift Real Estate Partners. Each seller made millions. Each buyer bumped up their rental rate projections to justify the new purchase price. Pyramid scheme? No – but greater fool theory at work? Likely. We’ll see what happens one day when the music stops.

DiamondView Tower

I’ve commented about how DiamondView is the most expensive building in downtown. And while I really do like the building, I think they’ve been the recipient of fortunate circumstances rather than the building really being “worth it” rent-wise. Probably a very smart move, Cigna Insurance (with Cruzan as local partner) is trying to sell at what may be peak market conditions. Rumor has it Kilroy is interested at $650/SF! That’s double most prices for downtown office on a per-square-foot basis – and will set a new record for the area.

New Condo’s and Hotels Galore

All the cranes and construction going on Downtown are hotel and residential. There are small exceptions – like Lankford’s Maker’s Quarter for 50k SF in East Downtown. And the Pacific Gateway demolition you see happening near the aircraft carrier and Seaport Village? I hope I eat my words – but I really doubt that project will get financing anytime soon. Hopefully it sells too – as I would love to see new buildings come out of the ground. But for numerous reasons, I don’t think we’ll see any deliverables for at least five years…

Musical Chairs

It’s not only landlord buyers and sellers playing high-stakes musical chairs. Tenants are too. For the first m in a half-dozen years, we’re having large clients evaluate leaving downtown. With office and parking rates escalating at a record clip, along with the lack of parking space and a surge of homeless people, the rose bloom might be soon falling off…”

Comment by oxide
2017-07-26 08:06:10

Each seller made millions. Each buyer bumped up their rental rate projections to justify the new purchase price.

Evidently these developers think that everyone has access to the same global debt that they do. Who do they think is going to pay this higher and higher rent?

Comment by Mafia Blocks
2017-07-26 08:57:09

Banks of course. The DebtDonkeys are line up to rent from the bank.

Comment by aqius
2017-07-25 12:00:28

what!? noooo, it can’t true!

you mean, san franciscoites would actually prefer stepping into a pile of money instead a pile of poop!??
you mean, productive san franciscans will actually leave nirvana behind to escape the leeches!?
what about all the orgaaaaanic stores? who will carry-on hipsterism? my god, THINK OF THE CHILDREN!!!!

(oh right, ain’t too many kids left in “the City” these days)

there ya’ go Ben. saved you a posting.

Comment by Ben Jones
2017-07-25 12:22:56

More dogs than children. Every boom brings a bust. Ask Calgary, or Toronto. It also shows how recessions begin during booms.

Comment by scdave
2017-07-25 15:46:52

Every boom brings a bust ??

I might say it another way; Every boom likely brings at least a correction.

Comment by Rental Watch
2017-07-25 17:05:16

Or said another way…it’s rare to have a bust without a preceding boom.

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Comment by Mafia Blocks
2017-07-25 18:54:06

Or in the case of this unprecedented mania, a record setting housing price decline is upon us.

Comment by scdave
2017-07-25 17:48:31

More dogs than children ??

Yep. They are cheaper and do not live as long.

Comment by Ol'Bubba
2017-07-25 20:36:29

And you don’t have to send them to college. Obedience school, maybe, but not college.

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Comment by In Colorado
2017-07-25 21:41:07

And if they become a nuisance, you can get easily dispose of them.

Comment by MacBeth
2017-07-26 04:10:05

And they wait with panting breath, all anxious to let you know wonderful they think you are.

Unlike children, who may remind you of your faults.

Comment by aNYCdj
2017-07-25 12:05:06

Hows this for positive news inter-webberzzz

Adobe Is Finally Killing Flash (For Real, This Time)


Comment by PitchforkPurveyor
2017-07-25 12:22:17

Tales of woe from a banker…

Imagine being a banker, completely responsible for the fraud and subsequent meltdown of the entire global financial system and economy. Then, imagine your subservient little bootlicking politicians run to you for answers to stem the tide, as you are drinking single malt scotch from the deck of your hundred million dollar yacht, and you tell them that a bailout or your industry is in order because, you know, it’s for the best of society, and you will continue to do God’s work.

Your bootlicking politicians give you a “yes, master” and run along, as you always require of them, and you see on the news the next day that the bailout has been approved. You laugh heartily, as otherwise you might cry because life’s so hard, then you take another long draw off your single malt scotch, and demand another foot rub from your illegal alien slave assistant who you’re paying less than minimum wage. You fire them for not jumping fast enough, and secretly call ICE to completely eviscerate them. How dare they do you so wrong after everything you’ve given them?

On the next depressing day it’s off to the country club for a round of golf and commiseration with a fellow banker and some attorneys, but not before firing your yacht’s captain because you didn’t like how he guided your white elephant into the harbor, though he assured you the waves couldn’t be avoided. Pffft, everybody is out to get you.

On the first tee you slice the ball two fairways over, and blame it on wind from an airplane, though not so much as a small breeze is detectable, nor any winged craft. You play a mulligan, as always, and this one barely makes the women’s tees. You see a groundskeeper on the adjacent green, tidying it up, and walk over to unleash a verbal assault as if he’s killed your entire family. You take your cart to the clubhouse and have him fired on the spot.

You forego the round of golf which is no longer entertaining and demand your driver take you back to your yacht, never even saying goodbye to the rest of the foursome, where you can start interviewing new prospective captains. On the way over, you’re not enthralled with the trip, so you relieve your driver of his duties - at a stoplight. You get into the driver’s seat in a blind rage and scream through a red light, delivering a glancing blow to a baby stroller as the young mother pushes her bundle of joy through the crosswalk. How DARE they be in the street! You don’t bother even stopping…

Comment by 2banana
2017-07-25 12:35:17

Jon Corzine….is that you?

Comment by Lane from sc
2017-07-25 12:43:55

I was hoping he screamed through a red light and got ran over by a truck! That would be a beautiful story!!!

Comment by Karen
Comment by Mr. Banker
2017-07-26 04:38:45

“Trapped in a foreign land, he said he was forced to work 15 hours a day, usually for no pay, first cleaning warehouses for the evangelical church and later working at businesses owned by the sect’s senior ministers. Any violation of the rules risked the wrath of church leaders, he said, ranging from beatings to shaming from the pulpit.”

I like it.

Comment by In Colorado
2017-07-26 09:18:30

What’s keeping these “slaves” from turning themselves in to ICE? They would get a free ticket home.

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Comment by Mr. Banker
2017-07-26 04:55:56

“They kept us as slaves,” Oliveira told the AP. “How can you do that to people — claim you love them and then beat them in the name of God?”

“How can you do that to people — …”

She’s joking, right?

Comment by Mafia Blocks
2017-07-25 13:05:55


Comment by junior_kai
2017-07-25 14:50:36

Nigeria has a paper called the Daily Trust? I bet the Onion is pizzed they didnt think of that. I wonder how many times they you find the nigerian equivalent of “he dindu nuffin” cited in that paper.

I’m thinking of starting my own paper - the daily Bull5h!t. It will carry all the crap the other papers do, but I’d be honest about it being what it is - crap.

Comment by Professor 🐻
2017-07-25 21:43:28

Name suggestion: Правда

Comment by snake charmer
2017-07-25 14:58:43

This appears to be legit.

“BUYING your first property is a daunting task for any adult let alone a teenager.

A 13-year-old Gosford boy has become one of the youngest property investors in Australia.

Akira Ellis was the inaugural winner of the Young Renovator’s Scholarship Program established by Renovating For Profit founder Cherie Barber.

The program teaches young, budding property entrepreneurs the ins and outs of the market, how to research and purchase property, and how to structure future investments.

The teenager sought out the investment property by himself, purchasing in Frankston, Victoria, in a joint venture with his parents Frank and Mychel and his brother Oliver and sister Saskia. The siblings even contributed some of their pocket money.”


Comment by Young Deezy
2017-07-26 07:35:16

Disgusting. Absolutely disgusting.

Comment by snake charmer
2017-07-25 15:04:50

Another doozy. Somebody make it stop. This house, in Clearwater, is the most expensive residence in the Tampa Bay area. And somebody’s trying to flip it. New carpeting, wallpaper, and a movie theater, that’s adding millions in value right there, no doubt!

“Less than four months after it sold for a record $11.18 million, the waterfront Century Oaks estate is back on the market — for $19.75 million.

The huge price leap reflects the fact that “it’s been completely redone,” listing agent Terry Novitsky said Monday. Among the upgrades: new carpeting throughout the 17,000- square-foot home, new Versace wallpaper, a new master bathroom and a new movie theater. The three-bedroom, three- bath guesthouse also has been remodeled.”


Comment by PitchforkPurveyor
2017-07-25 16:02:42

You can’t do $8 million worth of work in 3 months, not even close. This is one to watch, because it’s going to be an absolutely fantastic failure. They won’t even get what they paid, and the carrying costs of such an albatross are mind-numbing.

Comment by alphonso bedoya
2017-07-25 18:12:28

You gotta understand that if you buy the Clearwater House, you’ll no longer be homesick for Lagos, Nigeria and somewhere in here is a lot of information that appears on the blank side of legal documents.

Comment by MacBeth
2017-07-26 04:12:17

That’s some expensive carpeting!

Comment by In Colorado
2017-07-26 09:16:05

The reason homes have so much carpeting is that it’s cheaper than other floor coverings.

Comment by AbsoluteBeginner
2017-07-25 16:43:21

I don’t know, it would have to be really, really good pizza and at a really good price to crowd out the other pizza places:


I guess this begs the question, what other kind of services will be “disrupted” in the years to come? I am picturing drive thrus more often but that requires property for vehicles to wait in line, and not everybody is enthused about waiting like that anyway. If a business wants to compete, it looks like the mousetrap it needs to re-invent is how to eliminate expensive infrastructure more and make stuff just in time and peer-to-peer like, etc. This pizza van/truck whatever can have a warehouse in a cheap zip code and drive around taking orders off of smart phones. Hell, I joked with a co-worker the other week about something like this. Instead though, it would be a van that goes around delivering gourmet mustards, hot sauces, etc. because you never know when you want a bottle of Dave’s Insanity sauce and the store is a pain to drive to, lol.

Comment by In Colorado
2017-07-25 21:46:42

Most menial jobs will be automated into oblivion. And the sub 100 IQ crowd can’t be retrained for jobs that require an IQ of over 100. Half the populace (the lucky duckies) are going to be unemployable.

Comment by PitchforkPurveyor
2017-07-25 21:58:23

You reach a point where the job destruction starts killing off businesses, as their customer base has eroded due to declining incomes. We’re getting to that point now, evidenced by retail.

I don’t think a robot-produced pizza is a good business model when people don’t even have enough money for the basic necessities in life. Further, it’s not hard to imagine future tax policies which favor businesses with employees, penalizing those with robots.

Comment by In Colorado
2017-07-26 09:00:39

Hence all the chatter about “Basic Guaranteed Income”, which sounds much better than saying “Welfare”. Still, don’t know how it will be funded.

As for who will buy the robot pizza, I guess it will be the 50% who still have some disposable income. Of course this means less business, and some pizza vendors will fold. In a way we are already seeing this, as mom-n-pop places are having a hard time competing with the chains. Some survive by going upscale, but how many $20 a pie pizzerias can make it?

What we will probably see is that chains like Domino’s and Pizza Hut will vanish from their current locations and relocate to fewer and cheaper business park locations, where their droids can assemble pizzas and have them delivered in mobile kitchens so they are piping hot when they arrive at your door.

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Comment by PitchforkPurveyor
2017-07-26 09:44:14

“Some survive by going upscale, but how many $20 a pie pizzerias can make it?”

$20 is the going price for a pizza around here.Try $35 for the coastal joints, and it’s not even good pizza.

Comment by Rental Watch
2017-07-26 10:17:38

I’ve heard a number of times things like “half the jobs that exist today won’t exist 50 years from now, etc.”.

Makes me wonder…how many jobs from 50 years ago don’t exist today?

In other words, is the trend of the changing workforce new? Has it accelerated or decelerated from prior times?

Comment by In Colorado
2017-07-26 11:54:38

$20 is the going price for a pizza around here.

FWIW, you can get a large pizza from Domino’s or Pizza Hut for $8 in my neck of the woods.

Comment by In Colorado
2017-07-26 11:58:31

In other words, is the trend of the changing workforce new?

Perhaps not, but the number of jobless we have today is different than in the past, so perhaps it was easier to make the transition.

Also, in the past, the transition was to factory work, which didn’t require a high IQ.

Of course, the question remains: even if we could successfully retrain the displaced, would there be enough jobs for them. I’m going to guess “No”.

Comment by snake charmer
2017-07-26 06:52:53

I’m amused by how Silicon Valley celebrates disruption, without fully pondering the social and political consequences of disruption, although last year’s article on the doom preparations of tech moguls suggests that at least some people are concerned.

Not that I’ll be ordering a pizza, but if the power ever goes out for an extended period, all this technology becomes useless. There won’t be anything to replace it, not in the short-term anyway, because it will have been disrupted.

Comment by In Colorado
2017-07-26 09:14:43

I’m amused by how Silicon Valley celebrates disruption, without fully pondering the social and political consequences of disruption

Of course they don’t care. They’re just thinking about making billions in an IPO.

Comment by SW
Comment by CA renter
2017-07-27 05:59:39

Thank you for posting this, SW.

Comment by AbsoluteBeginner
2017-07-25 21:06:06

Vancouver. LOL. I think this must be how it is:


Comment by Professor 🐻
2017-07-25 21:40:37

‘But strangely this market is still suffering from a lack of new supply. There are actually plenty of buyers looking, but they’re a different buyer from 12 months ago. They are more cautious and viewing multiple properties before making a decision. Long gone are the days when buyers were diving in to avoid missing out as the market accelerated away from them.’


Comment by In Colorado
2017-07-26 08:51:45

A London crash is so overdue. They have prices that make Palo Alto or San Jose look like a bargain, yet half the city is either on welfare (living in megabuck, “free” council housing) or are low paid eastern Europeans.

It was simply mind boggling to see.

Comment by Mr. Banker
2017-07-26 05:03:38

More than a third of California households have virtually no savings, are at risk of financial ruin, report says.



Comment by Mafia Blocks
2017-07-26 06:54:42

The poorest most impoverished state in the US is full of poor people?

Comment by rms
2017-07-26 07:56:19

Why don’t they just buy a house and do a “cash-out-refi” as it rises in value every year? And soon their transgender child will be coming home from the military with a golden-parachute retirement check. Party Time! :)

Comment by Mafia Blocks
2017-07-26 07:59:31

They’re already doing that. That’s why everyone is so poor. Mortgage debt. And it’s happening everywhere.

Comment by In Colorado
2017-07-26 08:47:10

Lars Perner, an assistant professor of clinical marketing at the USC Marshall School of Business, said California’s high housing costs have put many households on shaky financial ground.

“The cost of housing in California is exorbitant,” he said. “That’s a big part of the problem. People pay a disproportionate amount of their income toward housing.”

And it’s not just mortgages. It’s rents too. They are absurdly expensive. I suppose that the only reason the poor aren’t fleeing for cheaper pastures is that they can’t afford to move.

Every time a head hunter contacts me about a job in California, I just laugh.

Comment by Mafia Blocks
2017-07-26 08:54:42

Rents may be or not be higher but they’re still half the cost of buying.

Comment by PitchforkPurveyor
2017-07-26 13:31:30

“Every time a head hunter contacts me about a job in California, I just laugh.”

I wouldn’t. I’d sharpen up my pencil and ask for an extra $3,000 per month over the going rate in Colorado, or whatever, to cover the additional housing and taxes, and if they did that then I’d jump on it. I’d rather live in a nice area of CA than Colorado any day.

Comment by Carl Morris
2017-07-26 13:50:04

I’d rather live in a nice area of CA than Colorado any day.

Why? Define “nice area”. So far I haven’t seen anything in CA that’s a clear winner over CO except maybe the coastal houses in places like Pebble Beach. But then you’re talking far more than 3k extra per month.

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Comment by PitchforkPurveyor
2017-07-26 14:23:18

I’m talking renting, NOT buying. I’d rather live in San Francisco, Sausalito, anywhere in coastal CA than Colorado. This place is perfect, along with the weather, in my opinion.


Comment by Carl Morris
2017-07-26 14:55:49

OK, so it’s mostly about the weather? I’ve been in Sausalito and Boulder on a nice day and I think Boulder is just as nice. But yeah, Boulder has a few more snowy days.

Comment by PitchforkPurveyor
2017-07-26 15:45:35

It’s not just the weather, there are innumerable more things to do and see in CA.

Comment by rms
2017-07-26 17:40:52

The higher education lead to higher wages, and California has made the investment in all levels of their college system, e.g., junior, state and university level. It takes a critical-mass of customers with disposable income before some businesses can become great operations. Outdoor sports are a good example. Look at the Olympic athletes and where they train? Hint, it isn’t in the mid-west. +1 for coastal living.

Comment by BearCat
2017-07-28 08:38:46

WRONG - Gabby Douglas trained in West Des Moines, Iowa under Liang Chow

I’d also say that in CA, “investing in education” = “more money to teacher’s unions”

Finally, the mid west actually has a long history of higher education

Comment by cactus
2017-07-26 09:24:12

Article talks about home ownership as a way to measure finical success.

The responsibility to maintain a home falls on the owner.

I’m constantly fixing my house. Can’t do it yourself it gets real expensive.

Not that single mothers can’t fix things themselves and not that poor people are poor because they have kids and no father around that would be racist. Not saying that …

Comment by julie
2017-07-26 10:41:26

Cactus. Since I myself am a single mother, I take issue with your generalizations. Owning property is how I got out of the mess of having the kids and being alone. Us single mothers are capable of astutely valuing a property and deciding if it will work for our purposes. Whether it is to flip, house our kids, or both. You must make money going into the deal, not coming out of it. Also, the way I did this was to borrow 75,000 dollars at zero percent on rotating credit cards for 6 years. I was ridiculed for doing this, by those who do not understand how smart it is. No closing costs, and tiny transfer fees (2-3%). I think it is a rare instance right now that it would work, due to the increasing house prices, but I imagine there are still deals around somewhere. You must be prepared to take chances that others are afraid of if you ever hope to get ahead.
Our world has been turned upside down and it’s a competitive place now for even the most simple job. A.I.is going to even supplant doctors. There are going to be diagnoses and meds prescribed by computer. It is coming. Some MD somewhere will be in the shadows, with his/her name on the line, but the work will be done by computer in many instances. Getting a good conventional education is not necessarily the answer. The kids must be taught to look at each situation anew and reposition themselves accordingly to survive. I don’t know at what point there will be violence in the streets, but at some point, it will happen. The few wealthy will be behind bars and gates, and the masses of discontented might roam the streets, unless they are all medicated with legal marijuana and other substances.
The good news is that the boomers, time and technology have helped reduce poverty worldwide hugely. But, now that everyone is surviving so well for so long, we have the new problems involving the 6th mass extinction, electronic imaginary money, and how to keep young people busy so they don’t resort to violent protest. Namaste

Comment by Mafia Blocks
2017-07-26 12:28:59

You were better off renting.

Comment by Rental Watch
2017-07-26 11:38:37


In particular I note that 40% of the Fed’s balance sheet is in MBS.

Question…when the Fed starts to bleed off their balance sheet, will they bleed off both MBS and Treasuries in proportion to their holdings? Or will they favor keeping one over the other?

Comment by PitchforkPurveyor
2017-07-26 13:36:26

The Fed IS the real estate market.

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